Background: There is now good evidence that sarcopenia and myosteatosis, measured as low skeletal muscle index (SMI) and low skeletal muscle density (SMD) from CT scans, are associated with poor survival in patients undergoing surgery for CRC. However, this is not clear whether this is as a result of tumour burden or chronic inflammation. Methods: The relationship between tumour stage, systemic inflammatory response using modified Glasgow prognostic score (mGPS), neutrophil lymphocyte ratio (NLR) and sarcopenia and myosteatosis using defined SMI/SMD was examined in 840 patients undergoing CRC resection from a prospectively maintained database. Results: The majority of patients were > 65 years of age (64.5%), male (55%) and did not have sarcopenia (51%) but had myosteatosis (65%). In those patients with a mGPS = 0 (n = 617), mGPS = 1 (n = 99), mGPS = 2 (n = 124), TNM stage of 0-I, II and III was not associated with sarcopenia (p = 0.260, p = 0.869 and p = 0.458 respectively) or myosteatosis (p = 0.136, p = 0.879 and p = 0.06 respectively). In those patients with TNM stage of 0-I (n = 202), stage II (n = 346) and stage III (n = 292), mGPS (0,1,2) was significantly associated with sarcopenia (p = 0.329, p = 0.001 and p = 0.002 respectively) and myosteatosis (p = 0.329, p < 0.001 and p = 0.001 respectively). In patients with TNM stage of 0-I, stage II and stage III, NLR was significantly associated with sarcopenia (p = 0.492, p = 0.299 and 0.027 respectively) and myosteatosis (p = 0.870, p = 0.012 and p = 0.019 respectively). Conclusions: Compared with tumour burden, the systemic inflammatory response (particularly mGPS) appears to have a greater influence on the development of sarcopenia and myosteatosis. These results have implications for the treatment of sarcopenia and myosteatosis in patients undergoing surgery for CRC.